Sea Empress Incident

To ask the Secretary of State for Transport what decisions were taken by the executive committee of the international oil pollution compensation fund at its meeting on Tuesday 16 April in relation to compensation payments to victims of the Sea Empress disaster; and if he will make a statement. [26353]

At a meeting of the IOPC fund's executive committee held in the immediate aftermath of the Sea Empress incident the committee decided that the fund should not make any compensation payments until the position regarding the total level of likely claims was clearer. On the basis of an agreement brokered by the Government, the ship's insurers, the Skuld Protection and Indemnity Club, agreed to make payments to claimants suffering hardship. To date, 62 payments have been made totalling some £240,000.

At a meeting of the fund's executive committee on 16 April the committee decided that the fund could start paying compensation to claimants, but because of continuing uncertainty about the level of total claims such payments should be restricted to 75 per cent. of the damage suffered by the claimant on the basis of the advice of the fund's experts at the time when a payment was made. It is believed that in the majority of cases the position of the claimants will be improved, but there might still be circumstances in which some claimants could still suffer genuine financial difficulty. To address this possibility, the Government have brokered a further agreement with the Skuld club whereby the club will make payments above 75 per cent. in cases of genuine financial hardship. The details of this arrangement will be discussed with representatives of Sea Empress claimants at meetings to be held in Milford Haven on 25 April.